Lendus.

Ground-Up Development Finance

Finance for building new residential or commercial properties from bare land or cleared plots, covering construction costs from foundations to completion.

200+ UK lenders
2-minute application
No credit check to apply
FCA-regulated brokers

Rates

6.5% – 10.0%

per annum

LTGDV

Up to 65%

LTC

Up to 85%

Timeline

12-24 months

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Finance structure

Senior Debt

Rate
6.5% - 9.5%
LTC
Up to 70%

Best for: Established developers with strong track record and pre-sales in place

Mezzanine

Rate
12% - 18%
LTC
Up to 90%

Best for: Developers needing to top up senior debt with limited equity contribution

Stretched Senior

Rate
8% - 12%
LTC
Up to 85%

Best for: Mid-market developers wanting a single lender solution above standard senior LTC

Key considerations

Exit strategies

Sale of completed units on open market
Refinance to long-term investment mortgage or portfolio loan

Eligibility

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Market context

Ground-up development finance is the largest segment of the UK development lending market, with specialist lenders deploying an estimated £6–8 billion annually. Average loan sizes have risen sharply since 2022 as build costs increased 30–40%, and lenders now routinely stress-test appraisals at a 10–15% cost overrun and a 5–10% GDV reduction. The UK government's target of 1.5 million new homes by 2029 continues to underpin strong lender appetite for residential ground-up schemes, particularly on brownfield land.

Frequently asked questions

Can I get ground-up development finance without a track record?
Most institutional development lenders require at least one comparable completed scheme. First-time developers can access finance through specialist boutique lenders at higher rates, often requiring a more experienced development manager to be named on the project and a larger equity contribution of 25–30%.
How are funds released during the build?
Funds are drawn down in arrears against completed stages of construction, typically 4–8 tranches. Each drawdown requires sign-off from an independent monitoring surveyor appointed by the lender. Day-one land and pre-construction costs may be available at initial drawdown if the site is already owned.
What is the difference between LTGDV and LTC?
LTGDV (Loan to Gross Development Value) measures the maximum loan as a percentage of the completed project's projected end value — lenders cap this at 60–65% for senior debt. LTC (Loan to Cost) measures the loan against total build and acquisition costs, typically up to 85%. Both limits apply simultaneously, so the binding constraint depends on your project's margin.
How long does it take to get a development finance offer?
Credit-backed terms can typically be issued within 5–10 working days for straightforward schemes. Full due diligence — including legal, valuation and monitoring surveyor appointment — usually takes 4–8 weeks to reach drawdown. Complex or large schemes may take 10–12 weeks.
Do I need planning permission before applying?
Most lenders require at least outline planning permission before issuing a formal offer, and full planning before drawdown. Some specialist lenders will lend at the pre-planning stage at higher rates, but the majority of the loan is not drawn until permission is secured. Pre-application discussions with your broker can begin before planning is granted.

Related project types

New Build Residential Mixed-Use Development

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